All Forum Posts by: Rob B.

I'm pretty sure that the premise entitles all of the legal property that they're renting from you, not just the interior. They're renting both the backyard and the house. 

Have you called him and asked him why he's not mowing the lawn? If we're talking about $18/month, I would hesitate to do into eviction for it. Why not deduct it from his security deposit? Also, even if he does vacate peaceably, the time that you're going to have a vacant unit with no cash flow will eat up the gardening fees for a year very quickly. I would try to talk with him and find out what the issue is. Eviction is extremely difficult and will cost you a lot more than it will cost him. 

How does financing work on residential portfolios? I'm looking at a portfolio of houses (9) in the Central Valley, but I'm wondering how financing for a portfolio of SFRs works. Is it a series of residential loans or one blanket mortgage or is it a commercial loan? 

Also, how much would I expect to need to put down? 

Can anyone tell me how big of a deal it is to have work done without permits? The work being the addition of a second bathroom to a 3/1 in San Leandro, CA and the conversion of the remaining garage space into a studio apartment with separate entrance. 

My long term objective for the property (currently my primary residence) is to live in it for another 12-18 months, then rent it out for 2.5 years (hopefully both sides separately) and then sell it. As an agent, I've seen plenty of houses listed that had work without permits done, so I don't know how big of a thing it is. Also, how much more difficult/expensive is it to get permits? 

I am remodeling my house, which includes adding a second bathroom. Since that will extend into the garage, it got me thinking about converting the rest of the garage space into a studio apartment. In two years or so, I am planning on purchasing another house and renting out this one , and it occurred to me that I could rent out the house for about $2,300 and a studio garage apartment for $800-$1,000/Mo. The short term option is to try to furnish it and rent it out via Airbnb. It has a separate side entrance and we could move the side gate so that the backyard is still ours. A few nights per month would certainly be some extra cash from the house and we have the right to stop any time we don't want to do it anymore. Then when we rent it out, we'll have a higher cash flow and we can sell it for a higher value because of the in-law unit. 

The property is in San Leandro, CA. It's currently a 3/1, we're turning it into a 3/2. The garage would be about 200 sq ft. Also, anyone with thoughts on garage remodel would be helpful. The short term money would be nice, but it's the long term rental and the resale value that's appealing. I'm not looking to downgrade into a duplex by renting to someone long term. 

Also, do those programs handle bookkeeping automatically? 

@Thomas Garza, I would be very, very careful with using your business for a political statement (any statement). I work in the Bay Area and it is an absolute minefield if you do not agree with the majority out here. I have seen businesses go down in less than a year because someone got upset at a position that they have, even if it has absolutely nothing to do with your business. A lot of people are just looking to be angry and if you give them an excuse, they'll find it. I made the decision a long time ago to be political or charitable with my profits, not my business. If you feel strongly about something (and I hope that you do and that you get involved), I would recommend you do it with the profits from your business and on a personal level, not a corporate level. 

Thanks for the input. We are also in talks with a second company that has 400 units, so if we bought both, we would quickly jump to 500 units. I have to say that the Propertyware demo seemed the most comprehensive, but that doesn't mean its the best. 

On the other side of property management, does anyone have any books that they would recommend or any pointers when getting into property management? I've got 20 units in SFR and MF that I've managed for the past four years, so I've got some experience, but now I'm managing for others.

I'm buying a property management company in San Jose, CA that manages about 100 units, all SFR or Condos. I am looking at the automated software such as buildium, propertyware, appfolio, etc. I am wondering if anyone on here owns a property management company or has a large number of units and has a recommendation for one program or another? Cost is not as important as the program that is going to make my life easier. I'd rather pay $500/Mo for a great program than $200 for a mediocre program.

@Joel, you are correct about the occupancy requirements. You would need to utilize 51% of the building space to qualify for an SBA loan. So I couldn't buy an accounting firm that needs 1,000 sq ft and buy a 10,000 sq ft building. But I could buy a restaurant, buy the building and sell the restaurant to another entrepreneur, trading my down payment on the property for a great building with a highly leveraged, lower interest commercial loan. 

@Dustin, that's exactly what I mean. I could potentially keep the businesses as long as they were absentee operated, but if I can sell them, I can free up capital to use to purchase other businesses and properties. Obviously this wouldn't be a quick process, probably a year or two for each. 

Ideally I would also find undervalued businesses as well. (While we're making wishes, why don't I throw a winning lotto ticket in there). But I have a colleague who is a business coach; while speaking with him about a mutual client, I thought about how if I owned the business (a body and paint shop), I could use my funds to buy a building as well as inject some much needed business sense into the business. He's wonderful at what he does, but lacks business sense. For $200,000, the value of his business could quintuple. I got to thinking about great chefs who hate running a restaurant, etc. If I could find businesses that were undervalued, or willing to sell cheaply, I could run them for a year or two, fix them up, buy a building and then sell the business when it was performing well.